According to the documents, the “Operation Mad Money” drug and money laundering investigation has links to GTA real estate

According to the documents, the

And it could be the tip of the iceberg, says one retired Royal Canadian Mounted Police officer and money laundering expert. In an interview, Garry Clement Ontario should follow in the footsteps of B.C. and call a public inquiry to assess how big an impact laundered money has in the property market.

The investigation, led by the Calgary Police Service, is part of an attempt to seize millions in what authorities allege are drug profits that ended up in money service businesses in the Greater Toronto Area, who passed them along to people trying to buy homes.

Highlights


  • “Canada really needs to sit down and realize we are still a very weak link. This case demonstrates that we have a long way to go.”


  • “We know that this is going on, we know money is coming into the province. All you do is look at the number of condos that are sitting vacant,” Clement said.

Court documents claim the sites didn’t have a licence to sell, and an investigation showed they did more than $3 million in business through multiple feeder accounts, accepting electronic bank transfers with explanatory notes including “weedguy” and “ed and bills.”

The investigation started with a Calgary police officer buying marijuana from websites called BudExpressNow and Cheapweed, a motion filed in Ontario Superior Court says.

Police watched money get deposited in bank accounts in Edmonton, and tracked some of that to three properties outside Vancouver, where they say it was used to pay $1.38 million in electricity bills.

The properties did have Health Canada licenses to grow about 5,000 marijuana plans, but a police raid in 2020 counted almost four times as many.

B.C.’s OffIice of Civil Forfeiture is applying to seize those properties.
In Ontario, authorities claim in documents filed in Superior Court that the alleged profits of the operation ended up in the control of Toronto-area money service businesses, which authorities say sent money in Canada to Chinese nationals interested in buying Toronto real estate.

In exchange, the Chinese nationals repaid the money in China, the documents say, pointing out that this is a way to circumvent currency controls in China that prevent money from easily being withdrawn from that country.
Ontario’s Attorney General is now applying to seize some $3.7 million in bank accounts it says contain money from the marijuana sales.

“The pattern of deposits into the subject accounts, including the frequent, large deposits made in round numbers, is indicative of unlawful activity,” the court application says.
“The contents of the respondent accounts are made up in whole or in part by proceeds of illegal online cannabis sales and/or are instruments of money laundering.”

“The respondents were not in any way involved in the alleged unlawful acts that were apparently committed by unknown perpetrators,” said lawyer William E. Peppall.
“This is not a case of a delinquent individual, a felon, nor a criminal mastermind. The respondents are innocent bystanders who purchased for legitimate reasons Canadian currency at fair market value in exchange for their Canadian currency that was earned through legal means,” he said.

One lawyer for the recipients of the money told a recent court hearing they believed everything was legal and had no idea that the money deposited in their accounts could have come from unlicensed marijuana.
The allegations are in civil court, which rely on a lower standard of proof than criminal court. Nothing has been proven and a judge is weighing the case now.